Agriculture Committee on May 13th, 2010

[The Chair, Conservative, Larry Miller]

Could we have our committee members and our witnesses come to the table, please?

I call this meeting to order. It's great to be here in P.E.I. on the last leg of our cross-country tour studying the future of agriculture. I'd like to thank all of you witnesses for being here this morning. As a farmer myself, I know what it's like to take a day off, or part of a day, but this is very important and it's nice to be able to hear from you.

We've got seven presenters this morning. We have not nearly as many witnesses in the second half, so if it's okay with the committee, I may extend this session by ten minutes, if we could have that flexibility.

I ask our presenters to keep their opening remarks somewhere between five and seven minutes. I'll be flexible if I think you're winding up, but at the five-minute mark I'll give you a sign that you have two minutes left.

If you have written remarks that you aren't able to totally read in, could you please give them to Isabelle, the clerk, afterwards? Every committee member will get a copy of them, so you'll still have your presentation.

With no further ado, we're going to move to Morgan Smallman.

[Morgan Smallman, As an Individual]

I'll break the ice. I'm Morgan Smallman.

Just before I begin, I have one question that I want to ask. This is from my point of view. I want to know why May has been the time chosen to hear stories and arguments on the future of agriculture. I ask this because springtime is the preparation and planting period. It is a critical time for seeding, which will reflect on how our crops perform throughout the rest of the season. I bring this up because I believe Canada is becoming more and more removed from agriculture.

I come from a family farm in rural western P.E.I., which is currently operated by my father, my uncle, and my grandmother. The farm has been in my family for over 125 years, and we've always had a combination of crops and livestock. Over the years the family farm has become more concentrated on growing hogs and wheat to feed the hogs, as well as potatoes for the table market and processing.

Our farm operated like this for over 20 years, each year tolerating new rules and regulations that Canadian policies have enforced upon us. I've always had an interest in agriculture, in particular farming. I've watched my father care for livestock and tend the crops. He taught me a lot of lessons that I will carry with me for the rest of my life, lessons I had hoped to be using to continue the family farm.

Knowing that agriculture is an industry that is moving forward in technology and becoming more like a business, I decided to continue my education after I graduated from high school, and I attended the Nova Scotia Agricultural College. I took a bachelor of science in agricultural economics, and my thoughts were that these new skills that I would obtain would help me to bring a younger and more modern view to our family farm. Unfortunately, the farm got smaller, and with the closing of the hog plant on P.E.I., our family felt it wasn't feasible to pay freight to haul our hogs to Nova Scotia, since the price for hogs is so low, so the mixed operation that the family had operated for years is now a cash crop operation relying on potatoes and grains.

That's the history. Now here's the problem. I'm 23 years old. I've been to university. I carry a debt load from tuition, and I want to farm. How many young people do you hear saying that? This all sounds great, I know, but how many are going to finance a 23-year-old to purchase a farming operation consisting of land, machinery, buildings, and of course its own debt? Let me just remind you that we are talking about a 23-year-old with no collateral, who is already carrying a significant amount of debt.

My family has worked hard to build this business as well as it could, and it deserves a fair price for the hardships it's gone through to do so. The trouble, as I alluded to before, is I can't afford to assume the risk, or even pay for this today, especially with the uncertainty in the markets for our industry.

We, as young farmers, need help. We want to produce food for the rest of the country, for our friends, our families, and our neighbours to consume, food that we know is safe, food that we know. Why can't there be a program encouraging young farmers like me and others in this room to help us to get into an industry that can support a country? What if instead of spending money on transporting food from other countries we invested that money in our own agriculture to help make it feasible? Why can't there be stronger risk management programs for young farmers--low or no-interest loans would even be a help--to make it so that we can do what we love to do?

Farmers are investors. They can't hold onto money. Farmers help keep the economy going. They're always looking for ways to better their operations, whether that be in new equipment, a facelift on some of the older buildings, a new truck, and the list goes on. In P.E.I. in particular, agriculture supports a lot of people. I've heard it said countless times--and I believe it is true--that when farmers are hurting, everyone is hurting.

Thank you for listening to my story.

[The Chair, Conservative, Larry Miller]

Thank you very much, Morgan.

Regarding your question about travelling, as a farmer, I guess I'd always say unless it's the first week of January, no time is a good time. This committee, in the almost six years I've been in Ottawa, has never travelled out and met with farmers. We recognize the fact that it is seeding time and it is calving time, but we thought it was much easier. A young fellow told us yesterday in Nova Scotia that he questioned whether he could even take the time off to come yesterday, but he said he definitely could not have come if it had been in Ottawa. I know it is never perfect, but we wanted to come to you anyway.

Our next witness is Gerard Mol, for five to seven minutes.

[Gerard Mol, As an Individual]

My name is Gerard Mol. I immigrated from Holland 23 years ago with my father. We started out with a potato farm. We've been diversifying a bit over the last eight to ten years, and we started growing canola, corn, soybeans, flax, different commodities.

We bought a machine to make fuel, to start threshing for the canola oil for fuel and for human consumption. I didn't get there yet for human consumption, but we'll try to get there. We also export canola to Japan and we're going to have different crops starting after this year to also export to Japan. We're doing some research on four or five different crops. That's a little bit of background there.

I came here when I was 17, basically. We started to invest right away and, what Morgan just said, started to farm a little bit. I went to Farm Credit; at that time they wouldn't look at me. LDC at that time wouldn't look at me. Anyway, the guy that sold me the land was willing to lend me the money for the year, and that's how I started it, kind of on my own a little bit. Anyway, there is opportunity, but the thing is that was 23 years ago, and that's changed.

I'm glad to have the opportunity to speak to you today, and I also have a time issue. I'm busy in the fields and all that stuff.

Agriculture to P.E.I. is like the cod fishery was to Newfoundland, I find. We all know what happened to Newfoundland--the cod left and Newfoundland was in trouble. I think it's the same idea with agriculture here in P.E.I. When agriculture leaves P.E.I., we'll have nothing left, and that's a serious issue. I think we're not too far away from that. We have to give a look a little bit of how we can avoid that, of course. I think we are already too far away from turning the wheels 100% back, but maybe we can.

What happens is it's really becoming a global market out there, and that's an issue. We are an exporter province, and we lost markets due to political issues, transportation issues, and also other people didn't know how to farm, more or less.

This takes a lot of adapting to the marketplace for farmers. We can't find markets for our products like we used to. I never expected to become an exporter in certain things. I thought I would a farm. But I think this is what we are heading into. Food safety becomes a big market issue. We as farmers produced safe foods for a hundred years, and also still now, so I find that is a big issue. Why put extra cost on some of the shoulders of the farmers?

We have an investor program now. It used to be CAIS before. As a farmer, I don't like to use these programs. Give me cost of production plus a little bit more to survive and I'll be happy. But in the last couple of years, every farmer had high hopes that some money can come out of these payment programs to stay in business. I really think the program is not great, but the thing is, it's great that the government is willing to help. But this program is not working. We have an Olympic average. I think that is something that's got to be thrown out. Maybe I'm wrong on that; maybe some people can say that.

I diversified my farm over the last eight, nine, ten years, and it seems to be the more I did to diversify, the less I was getting out of this program. It's not because I am making money on this diversification, but I'm just below the profit level, and whenever you have a sliding number of profit, then you can't get any money out of it. So the Olympic average is working and the cost of fertilizer spray and seed is all going up. The highs and the lows are not there any more, so there is no payout any more.

That's that, and I have a couple of other points I would like to mention.

The U.S. dollar is a big issue, and the euro right now. McCain is bringing french fries into North America now from Europe, because of the U.S. dollar.

Food safety--GMOs is an issue. I don't know how we can tackle some of these things, but I think we should have a look at some of this stuff. Seed production is also in the control of some of these high, big companies, and I think it's got to go more into the farmers' hands.

I'll leave it at this, and maybe you'd like to get discussions going afterwards and see what we can do.

[The Chair, Conservative, Larry Miller]

Thank you very much, Gerard.

We'll move to Raymond Loo.

[Raymond Loo, As an Individual]

I'd like to thank everyone for giving me the opportunity to come here and speak today too. We work fairly closely together on a lot of what Gerard was just talking about, shipping internationally and so on.

I'm an organic farmer. I'm the sixth generation on my mother's side on the farm, so we've been there for quite a little while. My father came over from Holland and bought very much into the whole green revolution and cut out all the hedgerows and so on. Now we're putting the hedgerows back in, so it's funny how things go around.

We've seen in the last few years that the organic industry is growing quite rapidly. We're finding a lot of new markets and new opportunities. But one of the things that has been quite a big challenge for us is the Canadian standards, because in the United States they have equivalency already with Japan. They are working with equivalency with the EU and it gives them quite a big advantage shipping-wise. We still have to pay an extra $1,000 roughly for our farm to get the Japanese agriculture standard, whereas in the United States they pay $50 from a farm. So it's a big difference.

The whole GMO issue is also a big issue from an organic perspective, but also from a conventional perspective, because we're shipping non-GMO conventionally grown canola to Japan, which Gerard's growing and a whole bunch of other farmers here are growing in P.E.I.

We need to recognize whose interests are being served by the genetically modified crops, whether it's actually the farmers' interests that are being served or whether it's the corporate interests of the companies that are actually producing the seed.

I just want to relate an issue that really hit me last fall. I went to a whole bunch of countries in Europe, but I was in Denmark dealing with a feed company there and it was a shocking thing for me when I sat down talking to a lady in Tvis and she said she didn't want to put “Product of Canada” on. They're buying their organic soybean from China right now. She was worried about putting “Product of Canada” on the label, because she thought it was going to be hard for them to sell it, because Canada has got such a bad reputation from the environment, she said, and from GMO contamination. I was over there talking about selling non-GMO canola meal and non-GMO organic soybean.

I've gone down to Wayne Easter's office and got the Canada flags. I've got them stuck all over my luggage. That's the first time I've ever had someone look at me and think it was better to get it from China than it was to get from it Canada to be able to sell their product. That was a real wake-up call for me.

I had to explain I'm coming from an island on the east coast of Canada, that we have a large non-GMO capability here, and so on. It's just something to keep in mind international-trade-wise. Everyone's heard about the flax issues and so on. It's quite a big issue.

Some of the things we need to do to trade.... Farmers are constantly challenged. We've been producing for a long time, and not necessarily working as hard in the marketplace. We've been counting on other people to market our products after we produce them, and I think as farmers we have to do a better job of marketing our products ourselves.

We've gotten a lot of assistance from the provincial government here to go to trade shows in Japan. I've been back and forth six times, I guess, to the FOODEX show, and I would say a lot of the federal programs are not really geared to help the farmers necessarily. They're more for the companies and so on. Maybe they don't expect individual farmers to go and try to sell their stuff directly to consumers, but I see that as an opportunity for us to be able to do a much better job of that.

What we're doing is profiling all the farmers, telling the story. If you buy a bottle of jam in Japan, we can trace that right back to the farmer and we can profile the farmer's family and we've got that on a website so people can actually see the family. So we're wanting to connect and we want the consumers to actually realize when they buy something they're helping an individual farmer at this end.

We can do the same thing with the canola and with all the different crops, because we have the capability to do the traceability now. But from our perspective, as farmers, it's all new for us.

I'm much more interested in having a discussion. I'm not going to talk here a long time. If I liked to preach I would have been a minister. I would sooner have questions and answers afterwards, so I'll pass it on for someone else.

[The Chair, Conservative, Larry Miller]

Thank you very much.

We'll now move to the National Farmers Union, and I guess Sally Bernard is going to do the presentation. Seven minutes, please.

[Sally Bernard, Youth District Director, National Farmers Union]

Good morning. Here I am. I'm your girl. I'm 27, I'm a woman, and I'm a farmer. I'm a rare find, because I'm a farmer in a growing sector, not a shrinking one. I help to manage a 550-acre organic grain farm. We also produce organic lamb and chicken. I'm proud of how we manage our soil and I'm confident that we're doing things the right way.

You've come a long way to find her, but here I am. I'm a farmer and I'm proud of it. As the youth district director of the National Farmers Union on P.E.I., I'm here representing our concerned young farmers, and at first glance that probably appears to be my primary role. I would argue, though, that my role as a mother in a farming family is perhaps more valuable in this circumstance. More so with agriculture than any other career, farming parents hope to build a legacy and a business they can pass on to their children, in the hopes of allowing them to raise a family and make a living on the land that has been so vigilantly cared for, for generations before them.

Even in a growing sector like organic grains, my family is increasingly uncertain about the likelihood of having anything to pass on at all. So as a young farmer, it is difficult to get excited about spending my life building a company that no one will want to take over or even buy.

As Canadians grow more and more dependent on imported, cheaply produced food, our agricultural community here at home is taking a bigger hit every day. With truly sustainable agriculture relying on a systems approach, such as grain produced for animal feed relies on fertilizer from those animals, once one component of the cycle is gone, the entire community collapses. Unfortunately, that's exactly what we're seeing now. Conceivably, it seems that current policy would suggest getting rid of the commodities that are not making money, and focusing resources on those that are profitable, bigger, or newer. Admittedly, this might seem like a wise fiscal move, but it is laughable in the logic of the cycle of sustainable food production.

Until the recognition of the importance of every aspect of farming is accepted by everyone in positions of authority, Canadian agriculture will continue to decline at an increasing rate, and this decline is directly proportional to the rate at which we will continue to lose young farmers and fail to attract new ones.

However--and here comes the solution--very recently the NFU began working on a project to look at the development of a domestic fair trade system within Canada. After a series of consultations with various stakeholders within food production, including retailers, marketers, chefs, eaters, and of course farmers, some logistics were laid out in terms of developing such a system. It was agreed that farmers are not making money for lack of it, because we know the money is within the wider system, from consumer to farmer. One statistic says that since 1995, despite a 40% drop in payment to farmers, consumers have seen a 22% hike in costs at the store. It's being allocated unfairly within the food system because of a gross economic and power imbalance between farmers needing greater market power to deal with increasingly concentrated suppliers, buyers, and retailers. There are consumers who genuinely care about the survival of the family farm in Canada, and however well-intentioned, they simply don't know how best to support it. A domestic fair trade system would be based on a mutually beneficial relationship from the farmer receiving a fair price to the consumer paying a fair price and the people in between taking a reasonable fee for distribution expenses.

Using the marketing of a fairly traded product to assure consumers they are supporting a farmer and not a corporation would pay dividends not only to Canadian agriculture but would help to increase awareness about the importance of maintaining our own food system. Domestic fair trade would serve to create a new level of trust about the origins and safety of food, building long-term relationships based on respect and confidence between consumers and producers. Farmers have occasionally been made out to be uncaring about the environment or unwilling to cooperate with new legislation, but many times they simply cannot afford to implement new costly changes to methods of farming that have stood the test of time. With a domestic fair trade system, production adheres to social, democratic, and ecological standards, which the farmer would look forward to being able to afford to implement and the consumer would be happy to support.

Through its very nature, domestic fair trade serves to revitalize a sense of community and bring life back to rural Canada. If Canadian agriculture cannot create an enduring connection with Canadians, our agricultural sector is doomed from the start. A domestic fair trade system would begin to create a link between consumers and where their food comes from, ensuring a strong market for Canadian agricultural products right here at home. Very few would argue that life on the farm is an ideal place to raise a family, live a healthy quality of life producing food for oneself and others. Through farm tours and school visits, many farmers will tell you that many kids are genuinely interested to know more, spend more time, and consider a life of farming. Domestic fair trade is one very feasible method of maintaining these dreams and creating future farmers in Canada.

Thank you.

[The Chair, Conservative, Larry Miller]

Thank you very much, Sally.

We now move to Mike Nabuurs, of the P.E.I. Federation of Agriculture.

[Mike Nabuurs, Executive Director, Prince Edward Island Federation of Agriculture]

We have joint presentations. Ernie Mutch is the president of the association, so he'll start.

[The Chair, Conservative, Larry Miller]

Okay, very good.

[Ernie Mutch, President, Prince Edward Island Federation of Agriculture]

Thank you, Mr. Chairman.

I'd like to thank the standing committee for an invitation to present.

This being your last province to present to you, I think you've probably heard it all before. I was always one to believe that the more times you hear something, at the end of the day there must be a bit of truth to what you're hearing.

Anyway, the P.E.I. Federation of Agriculture is P.E.I.'s largest general farm organization, representing over 600 individual farmers, with representation from each of the major commodity groups and agriculture production organizations making up our board of directors.

The focus on today's discussions, as we understand it, is to look at how to encourage young people or new people into a career in Canadian primary agriculture production. We've heard from some young farmers already this morning, and it is clear that we see significant challenges ahead of them. Yet they have optimism and energy to push ahead as they work to find solutions. We will need some of this optimism and energy to make the necessary changes to federal and provincial policies, in order to sustain agriculture in this country.

The first thing we have to acknowledge is that planning for the future is a good idea, but planning for the future without recognizing immediate needs makes no sense. If we can stabilize the current challenges, then the future will, to some extent, take care of itself. If agriculture is profitable, new entrants will come in on their own.

Immediate needs of our farm businesses must be addressed to stabilize the grain, horticulture, and livestock sectors. This is most appropriately done by correcting the AgriStability weaknesses, which have not enabled proper risk management since its inception in 2008. Ministers must move to amend AgriStability retroactive of 2008 by implementing the following: remove the negative margins and profitability tests; provide farmers with the choice of having either the top 15% of the reference margin coverage or participation in the AgriInvest program; increase the cap for contributions to AgriInvest from $1.5 million annual net sales to $3 million annual net sales, double-matching contributions from $22,500 to $45,000; provide the highest reference margin by using the calculation either on a five-year Olympic or previous three-year average reference period; increase negative margin coverage from 60% to 70%; and give greater consideration to business risk management programming, based on the cost of production rather than margin-based coverage. These changes would convert AgriStability to a more responsive program, with the capacity to deal effectively with changing market circumstances. The program would finally meet the accepted criteria of being predictable and bankable.

The P.E.I. Federation of Agriculture recommends that the government remove the non-BRM clause currently written into the AgriFlexibility policy and work with industry to ensure the program has adequate resources to meet the needs of Canadian farmers. Business risk management programs need to be flexible to address regional differences across the country. One size does not fit all. This is why AgriFlexibility was introduced to address regional differences and to create innovation to enhance these coexistent differences. We applaud government's efforts to address the reality, but this recognition needs to apply to business risk management programs as well. The prime example of where business risk management programs have fallen short for the Atlantic region is the hog sector. Problems in the hog sector were supposed to be addressed with the hog transition program, which encouraged producers to exit the industry. This was implemented to reduce the national supply of hogs. The Atlantic region does not contribute to the oversupply of hogs in Canada. We are net importers of red meat into our region. Why would our hog producers be encouraged to exit the industry as a result of a western oversupply problem? Working on a regional basis, all our agriculture programming is the only way to address the long term and create stability in the agriculture sector for future generations.

[Mike Nabuurs]

I will finish the presentation.

Another area where federal policy requires immediate attention is the regulatory framework for Canadian farmers compared to what exists for imported agriculture products into Canada. Are we certain that all food that is imported into Canada meets the same standard as Canadian farmers are asked to meet? Are Canadian Food Inspection Agency requirements being met in other countries where products are grown or processed and then imported into Canada? Are Canadian food standards and requirements even discussed when trade deals are on the table?

If the answer to these questions is "no", or "we're not sure," then we are placing Canadian agriculture at a disadvantage, thereby jeopardizing the future security of food and food production in this country.

Paying farmers for environmental goods and services is being done in the U.S. and Europe. Recognizing the value of preserving natural capital for the rest of society is crucial to the long-term sustainability of agriculture in this country. Paying for environmental services is not trade-distorting. The work farmers do to protect the environment is a benefit to them, but also a benefit to their community. Why should this entire cost be borne by the farmers alone? Other regions around the world have recognized this, and Canada must recognize it now as well, or risk putting our farmers even further behind in the competitiveness race.

This country needs a long-term food strategy. We need to define some goals and put in place a process to make them happen. This strategy development is not government's job. The development of a long-term national food strategy is the agriculture community's job. Once the agri-food industry stakeholders come together to define a national food strategy, we will need governments, both federal and provincial, to work with us to make it happen. This food-based strategy is being developed at the national level now, and we are optimistic that government will work collaboratively with the agriculture community to meet these long-term goals so that the future can be more secure and encouraging for today's young farmers.

There are opportunities for agriculture and for future generations in agriculture, if the right policies are implemented. This means developing policies for the current challenges as well as tomorrow's. How can we possibly expect new farmers to enter today's agriculture sector when many of today's farmers are, unfortunately, looking for a way out?

Thank you.

[The Chair, Conservative, Larry Miller]

Thank you very much, Mike.

From Atlantic Veterinary College, Dr. Tim Ogilvie.

[Dr. Tim Ogilvie, Professor and Past Dean, Atlantic Veterinary College, University of Prince Edward Island]

Thank you very much, Mr. Chair. I welcome you and the rest of the standing committee not only to P.E.I., but to this lovely area of P.E.I. This is my home stomping grounds. I live a couple of communities over.

I've been dean of the Atlantic Veterinary College, and I'm past dean now, but when I heard that your committee was meeting in Stanley Bridge, I thought I'd sleep in a bit, have breakfast at home, and come and see you here instead of going to Charlottetown. So welcome.

I also thought I'd take the opportunity to describe a bit about what we do and what we are at the Atlantic Veterinary College. I know some of you may realize this and may have been there before. Wayne Easter is a strong supporter of AVC and I remember Mark Eyking having been there. Others may have been in to AVC as well.

If educational institutions, through the provision of highly qualified graduates, through the provision of professional services, and through the provision of research, which can help agriculture, can be part of the solution, I thought maybe you'd like to hear a bit about the Atlantic Veterinary College. So that's what I've come prepared to describe.

The AVC is a faculty of the University of Prince Edward Island and has been a faculty of that university since 1986. It's funded in part by the federal government, and the four Atlantic provinces now support it. Our operating budget is around $35 million per year and we have about $25 million worth of rolling research funds that we maintain that provide research activities out of the Atlantic Veterinary College.

It's the only vet school east of Quebec. It's one of five in Canada. We're partners with vet schools in the U.S. in the sense that we're accredited fully by the North American accrediting bodies that reside in the United States and Canada. There are 28 veterinary colleges in the United States.

We're also fully accredited internationally so that our graduates can practise anywhere around the globe. That's kind of a neat thing to consider when we think about globalization of agriculture, animal agriculture, and animal health.

We have 240 veterinary students in the program. That's 60 students per year, with 41 of those coming from Atlantic Canada, and 19 per year from international locations, primarily the United States, where there are not enough veterinary seats to go around. So we are a strong supplier of veterinarians in the United States.

It's a four-year program of studies, and students need to come to us with about two to four years of pre-veterinary education to get into the program. So it takes about eight years of study, and that's consistent across the country. It's the same in Guelph as it is in AVC.

We also have about 50 graduate students in our program. Something that people don't usually realize is that we also train to the doctoral level, PhD, master of science, and master of veterinary science.

We have about 100 faculty and about 125 staff. We are the only full-service veterinary primary care and referral centre in Atlantic Canada.

Our students undertake a very practical program of studies. In their final year, as some of the other panel members perhaps can attest to, our students go out on farms to provide services with our clinical faculty. They go into companion animal practices. They go to Calgary to undertake studies in feedlot medicine. They go to Quebec to undertake studies in dairy cattle medicine. They go to Kenya to undertake studies in international development activities around animal health and animal agriculture.

So if animal agriculture is part of the balanced system of agriculture in Canada, then I'd like to think that with your consideration and the consideration of others, perhaps we can continue to help provide solutions for ongoing research and ongoing provision of support to youth in agriculture.

One thing we try to do at AVC in terms of that is introduce young people to agriculture early on. We have a vet camp program at AVC that is highly subscribed. For four weeks this summer we will be taking 50 students from around the world per week, for four weeks, to talk to them about all there is to do with veterinarian medicine. They get lectured by our faculty, our staff, and our students, who describe agriculture systems to them and other things involving veterinary medicine.

I'll tell you, the waiting list to get into that program is just as long as the waiting list to get into vet school. So we try to encourage understanding of veterinary medicine and agriculture to the youth, because I do agree that there is an increasing disconnect between the citizenry and farming as it is today.

Apart from education and educating veterinary students, we also undertake programs of research, and I do think there are some opportunities here for farming to differentiate itself, its products, through research. Some of the research we carry out at AVC is in the area of veterinary epidemiology, aquaculture and fish health, and human biomedical research and human health. And when we think about what agriculture can be and should be in terms of the development and production of healthy food and the intersection with public health, environmental health, human health, and animal health, I think you can see that there's plenty of opportunity for differentiation research and the development of sustainable products from good, safe farming systems.

Thank you very much for the opportunity. If you have any questions, I'd be happy to answer them.

[The Chair, Conservative, Larry Miller]

Thank you, Mr. Ogilvie.

We'll now move to our last presenters of the session, from the P.E.I. Young Farmers' Association, Patrick Dunphy and Maria Smith.

[Maria Smith, President, Prince Edward Island Young Farmers' Association]

Good morning.

I had requested to go near the beginning because I do have an off-farm job that does pay my mortgage payments on my farm, and after work I go work on the farm. It's just a note that I did mention that I'd like to go first.

Good morning, and thank you for the invitation here today. Patrick and I are here representing the P.E.I. Young Farmers' Association. Our membership is comprised of young farmers between the ages of 17 and 30 from all sectors of agriculture in this province, including big farmers and small farmers.

The P.E.I. Young Farmers' history runs deep in this province, as we were founded in 1948, and we continue to strive and help to continue the rich history of farming in this province. The following presentation is comprised of challenges and solutions that we bring forward from our membership, and this is to address national issues, and provincial issues, at the end of the day.

As Larry said, my name is Maria Smith, and I am president of the Young Farmers' Association. To my left is Patrick Dunphy. He is the vice-president, and he is going to introduce the national challenges and solutions to these from our membership that has provided information to us.

[Patrick Dunphy, Vice-President, Prince Edward Island Young Farmers' Association]

Thanks, Maria.

As Maria said, I am bringing forth a few national challenges from our membership. I'll go through them. They're identified as problems, and the answers are identified as solutions.

The first problem that was addressed by much of our membership was access to capital and funding requirements. The solution would be making it easier for young farmers to enter the industry by offering, and helping with, advance payments or guarantees on a maximum of a loan. Interest relief on the loan is a pretty good example there. We need support, especially when we're trying to convince a lending institution to believe in the agricultural industry in Canada and to make it work. Perhaps we could have a national young farmers' program or a national young farmers' strategy.

The next problem is rising input costs and declining farm returns. A solution would be capping costs from suppliers of electricity, fuel, and fertilizer. We all need to make money. However, if a company is guaranteeing a certain percentage to their shareholders, why are farmers stuck in the middle and footing the bill? Where is government to help protect our farmers against profiteering by these corporations?

Another problem is competitive regulation in the global marketplace. Canada is no longer a leading country in agricultural innovation and development. Government has essentially let our farmers down and let other countries control what food gets into Canada. Canada must protect its farmers against these regulations and challenge other countries to have the same protocol that's required of our producers, or not allow them access to our Canadian markets. The U.S. has done an excellent job at this with their country-of-origin labelling.

The next problem is a national food policy, or lack thereof. There is no national food policy in Canada. Canada needs a system that, at the end of the day, provides safe and healthy food for Canadians and a return for its farmers. Canada must adopt a policy that will inhibit imports of unsafe food, and allow its own backyard Canadian agriculturalists to thrive before imports are accepted. If food is imported, it must meet the same standards as our Canadian products.

The fifth problem is regarding a united Canadian approach, that is, about having a federal, provincial, and territorial mechanism. As we know, our Canadian provinces do not work well enough together. We're all aware that there are challenges in every province. There should be a mechanism made up of deputy ministers and senior agricultural officials who work together on a regular basis, to develop regional and national policy for this country, based on what's going on in individual provinces. The awareness gained from this program, we think, would have a tremendous impact, as all provinces would be supportive of each other and be informed about their individual problems.

The next problem is that Canadians don't understand the agricultural industry. Whether you're a government official, deputy minister, minister, or a regular citizen in Toronto, the general public do not understand the food system at all. This lack of education has allowed our society to become disconnected from the farm base, which does not help put pressure on our politicians or government when they come knocking on our doors for our vote.

If something ever happens to our food system and all of a sudden there's not enough food in the system to feed Canadians, who's going to step up to the plate?

Farmers in Canada are taken advantage of every day by consumers, suppliers, and corporations who essentially tell the farmers what they're going to be paid at the end of the day.

We'll move on now to our provincial challenges.

[Maria Smith]

Thank you, Patrick.

We thought it was important to describe the provincial challenges so that the committee would know what maybe is going on in the province. We did a presentation to the provincial Standing Committee on Agriculture, and they told us that if we had the opportunity to present to the federal government again to make sure that it's known that the provincial level can't really do anything; it's all on the feds. I just wanted to point that out. That's exactly what they told me.

I'll go on to the future farmer program and provincial challenges and requirements. If you're not aware, we have a program on the island for new entrants who are young farmers. It's a really great program. But we discovered some problems and offered some recommendations to the province before they initialized the second program, which came in last year. It's called the enhanced future farmer program. I'm not too sure what's so enhanced about it. It's the exact same. We weren't consulted about our recommendations or the requirements that should be going into the program. I thought we were a big part of the puzzle for the program, so they should have maybe consulted us to see what we thought of the program and how it has been run for the last five years.

We have some recommendations. For the interest rebates, don't discriminate against those who don't have the educational background. Extend the program for a longer period of time. And help farmers strategically plan for the future and the ins and outs of what's going to happen down the road.

Young farmers have enough on their plates without having to deal with all this paperwork. We heard from our membership that it just seems like a lot of work to get into the future farmer program, so we want to see it become less mechanized down the road.

The second problem provincially is provincial policy. Agriculture policy and environmental policy are being fought over, and farmers are being challenged and stuck in the middle. It seems that ag policy will bend over and that environmental policy comes first. There's no provincial government official standing up for the agriculture industry at the provincial level.

The third problem is the approach in Atlantic Canada to working together. It's the same as the national issue. We need to see more cooperation. There is the federal and provincial debate about who is actually responsible for this crisis and what solutions are viable. We have to start acting on some things. We've been talking and talking and talking. What are we going to do? Let's do something. Let's have an action plan and go forward with it.

I've been making presentations now for the last five years, and I'm getting tired. I feel bad for a lot of people who have been here for the last ten years. I'd really like to see something. If you need to consult with us or help us get together for a week.... I don't care if it's a conference. We need to get something done about this.

In conclusion, I'd like to thank you guys for coming and inviting us here to present today. But as a lot of us have said, I have to mention the poor timing of these meetings in the dead middle of cropping season.

If you can take anything from this, these are serious problems, and you're headed down a bad, bad road. I might not be here next year giving federal presentations, because I won't think it's important. I'll just go to my off-farm job and do that for the rest of my life.

[The Chair, Conservative, Larry Miller]

Thanks, Maria.

We'll now move into questions.

Mr. Easter, you have five minutes.

[Wayne Easter, Liberal, Malpeque, PE]

Thank you, everyone, for coming.

I welcome the committee to the riding, as well. We did that last night. Thanks, everyone, for coming.

Maria, your comment that there are serious problems perhaps states it all. I'll just read the headline from a Vancouver paper from today's media clips: “One third of B.C. hog production shutting down this year: pork processor looks to Saskatchewan for hogs”. That's what we're seeing here.

The bottom line is that if you're going to fix the problem, you have to recognize that you have one. I think we can argue about whether it's a federal problem or a provincial problem. I think it's both. One thing I would argue about with Patrick is the federal-provincial factor. They do meet. They talk all the time. But at both levels, there just doesn't seem to be a recognition that there's a problem. We had the federal and provincial ministers meet in February. The hog industry is going down the tubes. Your beef industry's not far behind. Your potato industry here is in trouble. And every damn minister who came out of that meeting said that things were wonderful.

My question to you is whether the current safety-net systems are working. If not, how do they have to be changed? I think Ernie mentioned that you have to move to some kind of cost-of-production system using AgriFlexibilty.

Are our current programs working, and what would you recommend to change them? Could each of you answer? Who wants to start?

[Ernie Mutch]

I think you mentioned AgriStability, and I think that's a big concern. I expect you've heard all across Canada that the programs aren't working. Our provincial minister wants everybody to be involved in that program. We have 87% or 89% of our farmers involved in the program now. He thinks if everybody's in that then it's going to solve all the problems, but that's not the case, unless the program is tied to cost of production.

When it's tied to reference margins, our margins are going down every year, so how can a program work that way? A case in point is the ASRA program in Quebec. That's really stabilized the Quebec agriculture industry for the last several years. It's been really difficult for us in the Atlantic region to compete with Quebec in the livestock sector, especially. They've had those programs for years, and we've had nothing here. Unless something changes with those federal programs and cost of production is involved, we're going to be losing thousands and thousands more farmers.

[Mike Nabuurs]

If I could just quickly add to that, one point that's being made, and I've heard it a few times now, is that the business risk management programs have put out $1 billion less this year, and I think they're projected to put out $1.5 billion less next year. So the perception is this is great: the BRM programs are working; they're putting out less money. They're putting out less money because no one is qualifying for these programs any more.

They don't provide any kind of stabilization. They are designed—and everyone's done this—to pay out on a system that pays on highs and tries to level out the lows. The problem is there are no highs and lows any more; it's a continual steady decline. If we don't recognize that and come up with a program that really does create some stabilization, there's no point in having these programs any more.

[Wayne Easter, Liberal, Malpeque, PE]

Randall.

[Randall Affleck, Maritimes Coordinator (P.E.I.), National Farmers Union]

Yes, I agree entirely with Mike's observation on CAIS. AgriStability, and CAIS prior to that, were designed and might have worked in a normally functioning market. It just does not work whenever the margins are chronically low.

I looked at the P.E.I. agriculture insurance statistics. They manage the AgriStability here on the island. It's exactly as Mike said. The payments were quite large in the beginning, and now they've not panned out.

I heard an interesting presentation from an economist out of the University of Saskatchewan. Canada's system, our margins-based insurance system, especially when it's not working and we're not dealing with a normally functioning market, really puts the processing sector at risk. As a strategy you have to have production that's of consistent quality, reliable production, for the processors to invest and work in that economy. What we have now is a program that essentially provides no guarantee for investors to do that, whether they're producer cooperatives or outside investors, to further process our potatoes or whatever we're going to do.

AgriStability's a serious problem because it's a margins system and we don't have a normally functioning market. The only way to benefit from it is if you can identify your Olympic averaging and get the hell out, eh? That's not a plan.